The markets staged a bit of a come-back today, but the trading volume was unenthusiastic. SPX closed near its session highs at $1286 for a gain of $7 and RUT gained $9 to close at $746. Trading volume declined across the board with 2.5 billion shares of the S&P 500 trading; trading on the NYSE dropped 14% and trading volume on NASDAQ declined 9%. The only real economic news of the day was the ISM Services Index which came in at 53.7 for May, up slightly from April's 53.5.

The big question is whether this is just a temporary rally before the market continues downward? One way to address that question is to look for significant resistance levels to be broken. On SPX, the first would be around $1295 where SPX appeared to bounce back upward in mid-May. The next level of resistance would be around $1305 from late January. If SPX can break through those levels with some volume, we could breathe a bit easier.

Today's rally prompted me to remove my hedges on the Jun condor; it now stands at a P/L of +$380 with a delta of +$71 and theta = +$172. The 690/700 put spreads are about 1.5 standard deviations OTM, but that doesn't feel very safe in this market. My July condor stands at a gain of $920 with delta = +$1 and theta = +$62. So the July position is almost perfectly delta neutral, but if the market rebounds strongly, those call spreads will be pressured next - if it isn't one thing, it's another!